Fifteen years of civil war and the economic crisis in 1992 left remarkable scars on the Lebanese economy. The dramatic devaluation of the Lebanese Pound (LBP) and high inflation rate imposed a real threat for the wealth of individuals and firms. They sought refuge in the US doll…
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This dissertation examines the demand for domestic and foreign money by residents in Egypt. Previous studies on the demand for foreign currency denominated deposits in Egypt, claim to have found currency substitution. However, the Egyptian financial system has been characterized…
This document is a collection of essays in two issues of interest in macroeconomics and international finance. Chapter 2 introduces price promotions in a monetary DSGE model where consumers differ in their price sensitivity and look for promotions, and where firms choose their r…
The shift from a domestic currency (peso) to dollar denominated deposits (deposit dollarization) in Argentina and Bolivia is explained with a nonlinear model that incorporates ratcheting effects, hysteresis and network externalities. There are two principal factors behind these …
This dissertation presents an empirical study on currency substitution and its implications on optimal seignorage collection, as well as hysteresis effect in a highly inflationary economy, namely Turkey. First, we investigate the degree of currency substitution in Turkey, using …
Since the 1990s inflation targeting has become the prevalent monetary policy paradigm. This "new monetary policy" has four major features: a numerical and official inflation target, interest rate as the sole policy tool, central bank independence and no other objectives for poli…
The main objective of this dissertation is to investigate the dynamics of credit expansion and its link with economic volatility in Turkey. First, we introduced currency substitution as a factor, which becomes intertwined with liquidity preference in the case of a financially li…